Chris Bowen, Australia’s Minister for Climate Change and Energy, has stated that the country may introduce tariffs on imports of carbon-intensive products, such as steel, according to media reports.
The country will conduct a review to work on a feasibility assessment for the mechanism, undertake an assessment of carbon leakage risks and develop other policy options to address it. The final review report is scheduled to be completed in the second half of 2024.
The tariff mechanism is expected to be similar to the Carbon Border Adjustment Mechanism (CBAM) being developed in the EU, and is aimed at preventing international carbon leakage risks and creating fair market conditions to protect Australian producers that are working towards reducing carbon emissions.